In a major announcement for the European telecommunications business, Telia Company today announced an agreement to sell its international carrier division. Polhem Infra will be buying Telia Carrier for SEK9.4B, or $1.06B, on a cash and debt free basis.
Telia Carrier operates an IP backbone that by most measures is the largest global backbone network in the world. It’s assets include 67,000km of owned fiber and more than 300 PoPs in Europe, North America, and Asia. In North America in particular they have been adding dark fiber routes, including a recent expansion down into Mexico.
The divisions revenues check in at SEK5.388B ($610M), with EBITDA of SEK500M ($56M) not including capital leases and expenditures. That puts the EV/EBITDA multiple at 18.9. Some 530 employees will be making the transition.
Telia Company will of course immediately become a major customer of Telia Carrier under a long term strategic partnership. Financial backing from Polhem Infra will enable Telia Carrier to invest in both its assets and the services it delivers. Polhem Infra is basically an infrastructure fund owned by the Swedish Pension Funds, and this is its first investment in digital infrastructure.
We had Telia Carrier CEO Staffan Göjeryd here for an Industry Spotlight over the summer.
The deal, if approved by the relevant regulatory authorities, is expected to be completed during the first half of 2021.
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